$100-mn saving on recall: Toyota in row | autos | Hindustan Times
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$100-mn saving on recall: Toyota in row

Toyota’s reputation for safety has come under renewed scrutiny after an internal memo showed that the car maker’s executives boasted of saving $100 million through a limited recall of floor mats connected to a acceleration defect.

autos Updated: Feb 23, 2010 22:10 IST

Toyota’s reputation for safety has come under renewed scrutiny after an internal memo showed that the car maker’s executives boasted of saving $100 million through a limited recall of floor mats connected to a acceleration defect.

The memo was among documents released to a US Congressional committee investigating Toyota’s handling of safety issues. Its contents were revealed before Chairman Akio Toyoda appears before Congress on Wednesday.

The memo shows that in a confidential presentation at its Washington office last July, Toyota said it had slashed costs by persuading US regulators to agree to an “equipment recall” to fix defective floor mats in about 55,000 Camry and Lexus ES350 models.

The limited recall, in September 2007, appears on a list titled “Wins for Toyota Safety Group” that includes millions in other savings the firm achieved through lobbying for delays to safety and other regulations in the US.

The revelation is certain to increase pressure on Toyoda, to fully account for his firm’s handling of the safety recall of more than 8.5 million cars worldwide.

Toyota’s US critics are likely to use the memo to support claims that the firm underplayed complaints about acceleration problems. US regulators, too, face criticism for agreeing to floor-mat repairs rather than a full safety recall.